Press Briefing: Sunday, Sept. 27, 1998

CBS.MarketWatch.com

} Aus! German voters turn out Helmut Kohl

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BONN, Germany -- German voters facing historic changes and stubborn unemployment chose a new face over four more years of Chancellor Helmut Kohl, according to exit polls in Sunday's national election. Gerhard Schroeder's Social Democrats headed for victory in the race for a chancellor to shepherd Europe's largest nation through the government's return to Berlin and the switch from the trusted mark to the European common currency.

Chants of "Kohl must go!'' broke out in Social Democrat headquarters after the exit polls showed they had 41 percent of the vote. With the Christian Democrats winning just 35 percent, Kohl appeared to have lost his parliamentary majority. Kohl, acknowledging his party's defeat, announced he would not seek re-election as leader of his Christian Democratic Party and thanked his supporters. "It was a great time,'' he said.

PHILADELPHIA -- The summer stock market slide has hit particularly hard one of the nation's biggest and oldest mutual funds. Vanguard Group's Windsor Fund, a conservatively managed staple of 401(k) and other retirement plans at more than 2,000 institutions, has shrunk by $7 billion since April. Some of its best-known investments, including its biggest holding, Citicorp, have helped lead the market's fall.

But Charles T. Freeman, Windsor's bargain-hunting manager, is sticking to downtrodden stocks such as AT&T, Rhone-Poulenc and Caterpillar. And Citicorp, too. The way Freeman sees it, if these were profitable, low-priced companies when the stock market was still going up, they're even better deals today -- especially in light of the global economic recovery he sees ahead.

BOSTON -- In 1994, Artisoft Inc. of Cambridge, Mass., was riding high. Since then, it has shrunk from 700 employees to 150 and tumbled from a $13.6 million annual profit to a combined loss of more than $30 million. What happened? Windows 95.

Microsoft Corp.'s popular operating system and its successor, Windows 98, have caused life-threatening crises at Artisoft and many other software companies, simply because Microsoft keeps adding features to Windows that computer users once had to buy elsewhere. The practice has drawn fire from the Justice Department. For instance, Microsoft's addition to Windows of free software to browse the Internet helped spark the current federal antitrust lawsuit against the software giant. But Microsoft's upgrade strategy is nothing new. Since the early 1980s, the company has frequently added features at no extra charge -- disk repair utilities, networking support and Internet compatibility, to name a few.

Tod Nielsen, general manager of software-developer relations at Microsoft, insists that the Redmond, Wash., company adds features to improve the product, not to hurt smaller competitors. But Microsoft's slightest move can cause serious hardship for small companies that suddenly see their markets disappear.

WASHINGTON -- The House Judiciary Committee that is on the brink of taking up the impeachment of President Clinton is a kind of flawed mirror of America. Instead of a true reflection of the country's moderate political character, it projects a sharpened and amplified image of the nation's cultural and ideological extremes. From the conservative white Christian men who make up most of the Republican majority, to the diverse stew of left-leaning liberal Jews, blacks and women among the Democrats, the membership is laced with zealous, tart-tongued veterans of the ideological battles that most divide the nation: the fights over abortion and gay rights, affirmative action and flag-burning.

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